This research aimed to testing the effect of ownership structure, firm size, ratio of inventory turnover and margin of gross profit toward selection of inventory accounting method. The method of inventory evaluation was measured with dummy which was categorized 1 if it used average method, and categorized 0 if it used FIFO method. Ownership structure was measured with dummy which was categorized 1 if the manager has shares and categorized 0 if the manager does not have shares. Company size was calculated with LN of net sales. Ratio of inventory turnover was calculated with dividing cost of good sold in a certain period with the inventory. Margin of gross profit was calculated with dividing total of gross profit in a certain period with net sales. This research was quantitative research using secondary data which were financial statement of manufactured companies in consumer goods industrial sectors listed on Indonesia Stock Exchange 2010-2013. The sampling technique used purposive sampling and it resulted 96 observation sample from 24 companies. The research used logistic regression in the hypothesis test.
The result of hypothesis test showed ratio of inventory turnover affected the selection of inventory accounting method. Ownership structure, company size, and margin of gross profit does not affect the selection of inventory accounting method.